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On March 25, 2019, KIC announced that Philip Kazmierowicz, company co-owner, would take on the position of president. Nolan Johnson took that opportunity to sit down with Kazmierowicz in his Oregon-based R&D lab to discuss KIC’s history and his plans for the future of the company.
Nolan Johnson: First, can you tell us how you became involved with KIC?
Philip Kazmierowicz: I started at the University of California, Santa Barbara in 1978 as an electrical engineer. However, too much partying and not enough studying, and four years later, I found myself graduating with a degree in business economics. Unemployment was over 10% at the time, and it took me four months to find a lousy job selling advertising time for an AM radio station. Six months later, my Dad suggested I move home and go back to college to “learn something this time.” I wanted to follow his advice, but I did not want to go back to engineering. I had done pretty well in the few computer science courses I took before dropping out of engineering, and I figured if I could take a few more, I could land a real job.
In 1984, the computer science programs at all the local universities were packed full of students, but my undergraduate degree allowed me to enroll as a graduate student, giving me priority on choosing classes. I bought a second set of books for my father, and while he never actually drove to the campus, we studied together. After seven classes, I had my first programming job, and he was building his own profiling computer. Our class projects included several versions of a guitar synthesizer before they were commercially available. For my masters’ project, I wrote a program that would print the sheet music for whatever song was played on the piano (again, before this was commercially available).
After graduate school, I took a contract position at Hughes Aircraft in Newport Beach, California. My father continued working at KIC (Kazmierowicz Instrument Company)—a company he founded in 1977. In 1987, I convinced him to stop building his own computer and instead let me create software to run on the newly introduced IBM PC. This decision helped propel KIC into a higher-tech company, and by 1989, I was working full-time at KIC. Our main office has always been in San Diego, but in 1994, I moved to Oregon, and we opened a satellite R&D office where I have been working ever since.
Johnson: That’s a great story. You’re in the Portland area while the rest of the business operations are in Southern California. Can you give us the rundown on KIC? What are your products and applications?
Kazmierowicz: Our business operations are in several locations, including internationally. Our customers are international, so we must be able to support them everywhere. Our products are used in both the SMT assembly industry and semiconductor applications. We focus on the thermal management of reflow, curing, and wave solder processes.
The original surface-mount soldering oven was called “vapor phase” and used a liquid that boiled at a temperature just above the reflow temperature of the solder. With these systems, every single PCB in the factory had the same recipe, and there was no possibility of overheating the board. There was no thinking involved. You turned on the oven, waited until it said it was ready, and sent your boards through. For environmental and economic reasons, the industry moved to infrared panel ovens. These had some problems related to higher temperature settings versus board temperatures. If you left the board in there too long, it would fry. That’s where we became involved. We showed people that there were real challenges with IR ovens.
Once the industry adopted convection ovens, the next step was to build a system that would find the correct oven recipe automatically; however, our customers did not have a well-defined specification. The component manufacturers could specify the maximum peak temperature and maximum rate of rise, but the solder paste manufacturers could not define their requirements mathematically. Instead, they gave us profiles from HP, Xerox, or IBM that performed well, and asked us to figure out how to define this in a way that a computer could understand. We ended up working with all the leading solder paste manufacturers to come up with profile specifications that we then added to our software.
All of these inventions happened 15–20 years ago, and our current oven setup system is still the best in the industry. As a setup tool, that’s what KIC does. We help you to set your oven for curing, solder reflow, wave or semiconductor processes.
Johnson: Your company recently announced some organizational changes, which put you in a different role.
Kazmierowicz: Yes. Eighteen years ago, I stepped down as president, and my dad and I were very happy with the leadership that took over. But recently, we reached a point where we wanted to go in different directions with the company. I am back as president and am very excited about our future. We have a group of incredibly talented and engaged people, including many who work from satellite offices. We have a group of self-starters that want to get stuff done, and I am excited to be leading them again. We’ve been ahead of what the industry needs for a long time and have been very successful at selling our automatic systems worldwide. More and more companies are starting to understand all that we offer and are embracing the idea of being able to monitor continuously.
Johnson: We’re in your Oregon R&D facility where you come up with new ideas and do heavy-duty research. And that’s your history—you and your dad working on projects, innovating, finding something that nobody else has done before, being creative, and leading the way. Now, you’re going back to being president, which involves providing leadership, completing administrative work, and signing off on proposals and reports. You were president once, and now you’re back. How do you see your life changing?
Kazmierowicz: As I said earlier, we have a group of self-starters, including our key managers. The amount that I’m going to be involved is not going to be as a hands-on-the-wheel captain. I’m going to review the charts on a weekly and monthly basis to understand how we are operating. The people that we have in charge are good at what they do and have solid systems that work well. I am looking forward to this and enjoying it. In the process of deciding that this would work best, I became more involved and talked to everybody. I’m a big believer in the idea of consensus. Everybody is never going to agree on the same course of action, but a good leader encourages everyone to agree on a course of action that we will work toward 100% as a team.
Johnson: That’s a nice way to put it. I regularly have conversations new company CEOs who say things like, “We have some culture challenges to change,” or, “We have some work to do to get everybody aligned,” but I don’t hear that from you. It seems you feel like your company culture is pretty functional.
Kazmierowicz: Yes, we have a very solid system.
Johnson: Earlier, you mentioned you have a few key managers who have dialed in their roles. Can you tell us about them and what they do?
Kazmierowicz: That’s a good question. MB “Marybeth” Allen is taking over managing sales in Europe and the Americas; she was already in charge of the U.S. and Canada. We also have Freddie Chan who manages our sales and operations in Asia, which is a focus for our company because that’s where a majority of our sales come from. And MB and Freddie are working together to determine a direction for marketing. Carlos Espinoza has been with us for some years and is managing production and operations. Henryk Zazmier, my cousin, also started working with us as our accountant around 1990. Henryk is currently our CFO, and his financial insights dramatically ease the burden of managing this company. Then, Robert Baxter heads our 24-hour technical service department, and we’ve won many industry awards for the high level of support we provide.
The key to high-tech is to get a few really good people on board. And one of the problems is that technology, particularly the computer, is like an amplifier of talent. If you know how to use a computer well, you can multiply your productivity, and the better you are with it, the more you get out of it.
I love listening to Jordan Peterson who is a psychology professor from the University of Toronto and wrote a book called 12 Rules for Life. He talks about this principle where the square root of the number of people in a given organization are doing half the work. If there are 100 people in an organization, the square root of 100 is 10, so 10 people do half of the work. And in my experience, it’s true. My goal is for KIC to have more than its share of exceptional people. Ryan Wilshusen has been in charge of R&D for about one year, and he’s great at finding those people for our R&D team.
Johnson: It sounds like you have a great team. You also mentioned developing a big project with your dad. Where do you expect to see KIC in the next 12 months?
Kazmierowicz: We had a great year last year, and I think we’re going to have an even better one this year or at least as good. Everyone knows that this industry is cyclical, and there is always a recession in the future. Some people in the industry make capital equipment, such as pick-and-place machines and ovens, while others sell supplies, such as solder paste. If the contract manufacturing business falls 10%, the demand for capital equipment can drop close to 0% while the supplies demand goes to 90%.
Johnson: That’s the difference between supplies and capital equipment.
Kazmierowicz: Exactly. Fortunately, we’re a little bit more in the middle in that we sell equipment that can improve capacity or improve quality. So, we don’t necessarily drop off a cliff when the industry slows down. In 10 years, we’ve had good growth. And industry professionals who have been around for 30+ years like us know that there’s always a potential downturn. But we’ve been through tough times, and we will survive when we go through it again. One secret to our long-term success is our insistence on spending 30% of our gross sales on R&D. We do this regardless of the business climate. This turns a recession into an opportunity to move our technology even farther ahead of our competition.
Johnson: Thirty percent is a good number.
Kazmierowicz: I think the number only has to be 15–20% to be considered a high-tech company, and we have been a high-tech company from day one. Our employees also participate in our profit pool, which is fairly aggressive. It helps us share the profits in the good years and reduce expenses and maintain company loyalty in the slower years.
In August, I visited Freddie, our general manager in Asia. I asked him when he was going to retire. He replied, “They keep asking me that, but what could I possibly do that I would have more fun than selling KIC?” I said, “I heard that there’s a rumor going around that they’re trying to hire you away.” Freddie said, “Oh, they’re always trying to hire me away, but there isn’t a single company in our entire industry that has more upside than KIC.”
Every now and then, the team will send me online customer questions. A few years ago, a team member said, “Phil, there’s a post here, and people are confused about something.” I read through it and wrote a solid explanation for what was happening and why. We can answer these questions with confidence because we have many solder reflow ovens in our three R&D labs. And we have several full-time employees whose only job is to run test profiles. My guess is that we run more profiles in a single year than all our competitors combined have run ever. We are constantly looking at customer’s challenges, running profiles, and exploring software solutions. We have a stronghold on what’s needed in the industry.
For example, If I want to know what process windows they’re using in the world today, I send an email to our worldwide customer service team, and in less than a week, I can compare what is happening in Europe with China, Taiwan, and Mexico. This helps us find the product improvements that our customers and potential customers will find most significant. The question is, “Do we want to take advantage of our position in the industry to continue making our products better?” Yes, we do.
We have a group that is excited about moving forward, and I’m excited too. It’s also really fun to be working with my dad. I’m in Oregon, and he’s in San Diego, but I talk with him every day. Just today, he shipped me two fixtures he is waiting for us to test. Anyone familiar with the research part of R&D knows that most of your time is spent on ideas that never reach the market. But every now and then, you get involved with something that is almost magical and realize that this particular invention will soon add to a long and impressive product line of firsts.
Johnson: Excellent. Thanks for your time.
Kazmierowicz: Thank you.